Dividend Stocks
Stocks that provide dividends are an excellent way to build long-term wealth. Not only do dividends provide investors with regular income, but dividend stocks can also help investors weather market volatility. How? Whether the markets are going up, down, or sideways, dividends provide investors with a steady income stream.
Having said that, while dividends are usually paid out quarterly, at the discretion of the company’s board of directors, they can be raised, cut, or eliminated.
Not all dividend stocks are created equal. As a result, there are a number of factors investors need to consider when looking at dividend stocks.
Dividend yield is one of the most important factors to consider when investing in dividend stocks. It might be tempting to just invest in a stock with the highest dividend yield, but there is a risk/reward trade off when it comes to dividend-yielding stocks—the higher the yield, the greater the risk.
Stocks that provide an annual dividend of 10% or more tend to be very risky. Because they are risky, there is a greater chance the dividend could be cut—or worse, the share price could plummet. This means investors lose out on dividend growth and capital appreciation.
History is another important factor to consider. Look for stable companies that have a long history (five, 10, or even 25+ years) of both paying an annual dividend and increasing that dividend annually. Those stocks that offer annual dividend growth as part of their corporate culture are more likely to continue that trend.
The best way to determine whether or not a company can continue to provide an annual dividend and raise its yield is to look at the company’s free cash flow. Free cash flow is the amount of free cash, or money left over after it pays for operations and necessary capital expenditures. The more money a company has in the bank, the greater the chances are that it can sustain or increase its high dividend yield.
Safe 12% to 25% Yields Available From This Unique Investment
These Stocks Pay Up to 25% Today, investors have an incredible opportunity to earn double-digit yields. You simply have to look past traditional industries like utilities and consumer staples. Instead, I’m looking at a smaller section of the investment world.
OFS Capital Corp: Lock in an 11.4% Yield at a Discount?
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Earn 12%+ Yields From America’s Next Oil Boom
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Norbord Inc: Should Investors Consider This 14.2% Dividend Yield?
This Company Pays Generous Dividends This just might be the most interesting high-yield stock in today’s market. The dividends are not carved in stone, but those that held on to the company’s shares for the past year would have earned.
1 Dividend Stock for the Next 100 Years
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Massive Trend Making Fortunes Imagine downloading a Blu-ray movie to your smartphone in seconds. Or surfing the Internet at lightning speeds from the middle of a crowded football stadium. Or putting on a set of virtual reality goggles and watching.
Earn a 10.5% Yield by Being a Venture Capitalist
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EQT Midstream Partners LP: This 8.3% Yield Looks Like an Opportunity
A High-Yield Stock to Think About In a market where most companies pay less than four percent in dividends, an 8.3% yield certainly grabs income investors’ attention. I’m looking at EQT Midstream Partners LP (NYSE:EQM), a master limited partnership (MLP).
How to Earn a Dividend Check Every Month of the Year
These Stocks Yield Up to 18.1% Regular readers know I gush over dividend stocks, but they do have one drawback: quarterly payouts. The right business can make for a great source of income. But with their infrequent payments, investors have.
Sachem Capital Corp: Lock in a 10.5% Yield From This Penny Stock
Little-Known Company Pays Huge Dividends As an income investor, I like large companies with established market positions due to their ability to pay stable dividends. However, that doesn’t mean we should ignore small companies altogether. Case in point: Sachem Capital.
